The CBEC vide Press Release No.135 dated January 22, 2018 has recommended to grant relief to the Resident Welfare Association (RWA) by enhancing the limit of contribution made by members from Rs. 5000 to Rs. 7500 per month per member.
As a result of above press release, RWA’s shall be required to pay GST on monthly subscription/contribution charged from its member if such subscription is more than Rs. 7500 per member and annual turnover of RWA by way of supplying of services and goods is also Rs. 20 Lakh or more. Under GST, the tax burden on RWA’s will be lower for the reason that they would now be entitle to ITC in respect of taxes paid by them on capital goods, goods and input services. ITC of Central Excise and VAT paid on goods and capital goods were not available in the pre-GST period and there were a cost to the RWA.
These changes would be effective from January 25, 2018 by way of notification.